Module overview
The goal of the first part is to encourage a basic understanding with the tools of financial economics with particular emphasis to general equilibrium asset pricing. Upon completion students should be
confident in using standard techniques in order to address issues like the functions of financial markets and their efficiency properties as well as their traditional application to equity and bond pricing.
Aims and Objectives
Learning Outcomes
Knowledge and Understanding
Having successfully completed this module, you will be able to demonstrate knowledge and understanding of:
- Be able to manipulate the model to address common empirical and theoretical applications. Students should be comfortable taking the model to data with standard applications
- Be able to vary the model and build arguments to study a wide variety of applications
- Derive from basic principles the workhorse model of financial economics
- Be able to price a variety of assets
- Be able to solve the model and derive general results.
Syllabus
The course includes an examination of basic analytical frameworks such as expected utility and probability theory. A thorough General Equilibrium approach is the backbone of the course. Various popular asset pricing models are formally analysed including CAPM and Factor Models.
Learning and Teaching
Teaching and learning methods
.
| Type | Hours |
|---|---|
| Teaching | 40 |
| Independent Study | 160 |
| Total study time | 200 |
Resources & Reading list
General Resources
Notes will be made available via the course website on Blackboard.
Textbooks
Danthine, I.P and Donaldson J.B.. Intermediate Financial Theory. Academic Press, Elsevier.
Bailey, R.E. (2014). The Economics of Financial Markets. Cambridge University Press.
Assessment
Assessment strategy
Assessment is through one coursework assignment during the semester (worth 20% of the final mark) and an end of module written examination (80%). This is supported by continuous formative assessment in form of problem sets. This is the same for internal repeat. Assessment for external repeat and referral is through 100% end of module written examination.
Formative
This is how we’ll give you feedback as you are learning. It is not a formal test or exam.
Final Assessment Problem solvingSummative
This is how we’ll formally assess what you have learned in this module.
| Method | Percentage contribution |
|---|---|
| Final Assessment | 80% |
| Coursework | 20% |
Referral
This is how we’ll assess you if you don’t meet the criteria to pass this module.
| Method | Percentage contribution |
|---|---|
| Final Assessment | 100% |
Repeat
An internal repeat is where you take all of your modules again, including any you passed. An external repeat is where you only re-take the modules you failed.
| Method | Percentage contribution |
|---|---|
| Final Assessment | 100% |
Repeat Information
Repeat type: Internal & External